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this is the only thing we've ever wanted to do and ink helps us do it. make your mark with ink from chase. [ engine turns over ] [ male announcer ] we created the luxury crossover and kept turning the page, writing the next chapter for the rx and lexus. this is the pursuit of perfection. i always like to say, there is a bull market somewhere. and i promise to find it just for you, right here on "mad money." i'm jim cramer, and i will see you tomorrow. good evening, everyone. i'm larry kudlow. this is "the kudlow report." president obama took to the road today selling last night's state of the union message. regrettably i have to say i think i heard one of the most interventionist, regulatory heavy and government-planning

messages in the history. still more infrastructure, even capping climate change and all i wanted was full fledged tax reform or maybe the keystone pipeline. the left wing greenies pulling out all the stops and warning the president not to go there. some celebrities even got arrested froprotesting the pipee at the white house today. >> and the head of the unions wants more and more of our taxpayer money and he's threatening any democrat who doesn't go along. and guess who facebook executive mark zuckerberg is throwing a political fund-raiser for right at this hours? it's probably not who you think. anyway, we're "the kudlow report." we'll tell you later, but we begin right now. first up, so the president

proposing more, more government spending on manufacturing, more on housing, education, infrastructure, climate change, green energy. here's my take. if it was going to work all this throwing more, it's going to work to throw the economy up, it would have already worked. it's more of the same from mr. obama but these government planning efforts have never worked. we have a subpar 2% growth company and they're planning and spending and directing will never work. me? i was just hoping for some real economic growth measures, as i said, like a corporate tax reform. what's wrong with that? keystone pipeline, more limited rnme but it was not to be, at least not last evening. let's talk to our guests. we got a full house tonight. joining me tonight is austen golsby and we're delighted to have kelly ann conway and

forbes's magazine executive editor. this is the best economic growth message of the last 24 hours and it came from senator marco rubio. >> presidents in both parties from john frj. kennedy to ronal reagan have known a free enterprise economy is the source of our middle class prosperity. >> i want to start with that. no planning, no government direction, no subsidies, no collective action. i was hoping that your man would be closer to marco rubio. >> i a hundred percent gragree with that. the president had almost those exact lines in the state of the union. >> the trouble is he had a lot of other lines. therein lies the secret. >> you lost me at hello on this one. >> i want to start up. >> we didn't watch the same

state of the union. your thing is it was a socialist manifesto and the president was emphasizing the root of economic growth comes from investing in the education and skills of your workforce. you got to have economic infrastructure, you got to build airports, you got to have decent highways and we got to have the transportation system that we need. >> that's what you say, that's what you've been telling me, that's what the president has been telling us. but unfortunately economic growth has been going nowhere. by the way, i've never called him a socialist. i never have and never will and don't believe he is. but let's go to green energy. here we go again. he calls for more green energy subsidies, probably hundreds of billions of dollars. let's just review. what went under so far in the first term for green energy? solyndra, a-1 battery, solar trust. it's a bunch of crony

capitalism. tell us how wrong that is. let the market choose, not the government. let the market choose, not the government. >> look, i favor letting the market choose but i'll give that a 7 out of 10 in the wrong scale because you're picking the ones that didn't work and it was meant to be a big portfolio of all different kinds of energy when it was designed and we've had this all of the above energy policy, that's the only way to do it. so just picking three or four companies i don't think is that instructive. >> there's another ten i could have used. >> but explores natural gas, too. >> he doesn't say that. he should have come out for the keystone pipeline. do you think the energy department should be a hedge fund portfolio of all these companies they own? that's what austan goolsbe is saying. >> i love austan but i think

he's wrong here. i think if they want to be v.c. guy, they should be real v.c. guys and get out in the marketplace and do that. in the 70s everyone was saying the japanese, they're the way to go, let's follow them, they have all this central planning, look at their economy. then it all collapsed and they've been in a recession basically for 25 years. >> i'm not even going to do the hedge fund thing. i just want to know why it's the government's job to throw money at specific industries and specific companies. and i'm going to even add manufacturing. much as i'd like to see a manufacturing renaissance, he wants to throw money at manufacturing. we don't know that's going to be the industry of the future, only the marketplace knows. >> he certainly doesn't know. i think his state of the union wasn't a socialist manifesto, it was a love not to the hard left. he threw out a lot of terms that he knows are red meat for him. on this green energy, this sounds like solyndra all over again but this time with private

money. he's going to get the $2 billion from the oil and gas industry through the use of federal lands. why is that important? the memo from the white house today said the aim would be shifting our cars and trucks off oil. if you shift us off oil, who is going to pay for your next strawman? he never made good on his promness 2008. the oil and gas companies, many in the private sector have very efficient and successful green energy projects. it's already being done in the private sector. >> that's my problem. i don't want taxpayer money, i don't want the president to have a portfolio. why can't he come out and say he's for keystone, he's for the keystone pipeline and, by the way, we're going to open up more federal lands for natural gas drilling, which is changing the whole face of america's economy. why can't he come out and say that instead of green energy?

>> you had three different things in there and i'll try to answer two of them but i doubt you'll let me finish all three. >> i'm going to let you, if it's fast. >> on keystone, remember what we have now in the center of the u.s. is the price of oil is below the world price. if you build the keystone oil pipeline, what is going to happen is the price of oil in the center of the united states is going to go up by about $20 a barrel. and the major beneficiaries are going to be the producers of the oil in canada and a few refinery owners in the midwest. so i think to portray that as if it is equivalent to the benefits that we're going to get from the domestic drilling for natural gas i think -- >> explain to me why just on this point producing more oil is going to lift the price of oil. i don't get that. >> we were talking about the keystone pipeline. >> i am. that just shifts it to the refiners so the possibility exists that gasoline prices may

come down. >> no. the keystone pipeline takes the oil from canada and gets it to the gulf of mexico. right now that gets into the center of the country and there's a distribution bottle neck that it can't get out on to the world market. that's why the curbing oil price is below the world oil price. once you get that thing out to the world market, the canadians are going to love it because they will be able to finally sell their oil at the brent price, not the west texas price. >> cash in on that, michael. i want to hear your point on that. austan's a smart guy. i just don't understand what he's saying here. >> first of all, the biggest reason the price of oil is the price it is now is because the dollar is so weak. if you go back to the last two booms we had, the clinton and reagan boom when there was huge demand for oil, the price was nowhere near it is now. it's obama's week dollar that

has driven up the price of oil. >> we may be energy independent, austan. that's the kie keye point i'm trying to make. let me move on to the infrastructure. he wants another $50 billion of infrastructure. nobody is against infrastructure but anybody up on the hill says there should be long-term planning so we can do it efficiently. >> i agree with that. >> he has put so much extra money that never was shovel ready. you've heard that line, he used it himself, and here, too, i got to say to you all this government money, if it was going to jump the economy, why hasn't it jumped the economy? if it was going to work up till now, why hasn't it worked? infrastructure, he's going to have housing credits again. we've done all this. we've done all this. >> let's do it one at a itime. >> i don't like the government planning. i like free market resources. >> neither do i.

in the case of infrastructure, the president has repeatedly proposed that we ought to have an infrastructure bank in which you got a group of economic infrastructure experts rather than congressional leaders to decide what are the most important bottle necks facing the economy and how do we address those with infrastructure. the most important thing about infrastructure is that we get better infrastructure, a secondary benefit are the construction jobs and the whatever the shovel ready that you described. that's the second part of it. but the most important part is -- >> do you agree with that, kelly ann? >> i disagree. the gas tax is supposed to go to roads and bridges. when you focus on the gas tax, it's a hidden tax. they have no idea how much is included in a gallon of gas. when they hear what it's supposed to be committed to, improving their infrastructure, their traffic congestion, improving roads and bridges, which are woefully behind a decade or more in their

disrepair, the government takes that extra gas tax money and infrastructure money and diverts it into anything it wants to. the problem most americans have with government spending is simple, they don't believe what you promise to spend it on is where it ends up. when they hear $50 billion of infrastructure, they're going to -- >> they're going to go nuts. >> you just agreed with her but she just contradicted you. >> we're open-minded people. >> this is not a tax increase. this is let's spend the money -- >> it's a spending increase which americans don't like. >> it's a spending increase. i object to this because every year -- if you talk to the guys on the transportation committees, austan, as i have, they are for infrastructure improvement. we're always for it in this country. but long term, six, eight, ten-year time horizons and it is financed by gasoline taxes and some of it comes from the state level. the president is trying to layer on more stimulus, by the way, infrastructure is paid at the

higher union wage, it's very inefficient and it costs taxpayers more money and if that thing could be used as short-term stimulus, again, austan, it would have worked. but it hasn't worked. the president didn't get what he wanted out of it, he admitted we didn't get what we wanted out of it. >> the president said we need to improve the economic infrastructure of the country so we can grow. he wasn't talking about short-term stimulus. i think you're missing the point. >> i don't think so. another $50 billion i think is an outrage. last one. where's my corporate tax reform, austan? >> he said tax reform. >> he says it's got to be his kind of tax reform. tax companies that do work overseas or have tax breaks for companies here that bring jobs home. that's not real tax reform. that's government direction and planning. that's not lowering the rates and broadening the base for real corporate tax reform, which would be the best pro growth measure. >> we should do that. >> then why didn't he talk about it?

>> he did. there's about an 80 to 150 page document put out by treasury with a whole bunch of detailed ideas of here's how you can broaden the base and you should read that. >> in this state of the union, my friend, he is attacking business. >> he was not attacking business! how can you say that? >> he's going to have tax incentives for people who don't move jobs away. he's protectionist, he doesn't want to be global and low taxes for businesses and manufactures that create jobs. >> he's reducing the rate of capital, larry, how can you say that? my earth is shaking. >> it's not revenue neutral, it's not tax neutral, it's not real reform, austan. >> on the corporate side they talked about revenue neutral, broaden the base and lower the rate. >> where is it? where is it? i grief with you but it's not in this state of the union. >> when kudlow starts saying he doesn't want to reduce the cost of capital, encourage

investment. >> of course i do but i want it for everybody, not just for his favorite projects. that's not in the state of the union. >> all he said was in the united states. since when do you want it to be outside the united states? >> because companies are global. we should repatriate the $2 trillion overseas by lowering the tax burden if they bring it home. that's free money for investment. >> one of the two trillion is already domestic and one trillion is abroad. now, you can give a big tax holiday to give that 4 and 1 trillion back home -- >> they might just invest it. i'm sorry, the producers are yelling, i got to get out. i'm sorry we disagree on just a few things. appreciate it. >> now, i call it the brainiac rule. it's the push to get more highly trained and educated immigrants a faster and easier path to

citizenships. two big proponents, a senator and big name in the tech world are about to join us to make their push. later on the "kudlow report" gets to play the role of fact checker. remember at the state of the union when president obama -- >> so here's an idea that governor romney and i actually agreed on last year. let's tie the minimum wage to the cost of living so that it finally becomes a wage you can live on. >> is that really true? did mitt military really back that idea? we reach back into the "kudlow report" archives and we'll show what you governor romney really said to me on this show about that very topic. don't forget, free market capitalism is the best path to prosperity. my problem is i just didn't hear any of it last night. i'm still hoping. i'm still larry kudlow. we'll be right back. (announcer) scottrade knows our clients trade

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should the u.s. ease up on visa requirements for brainiacs and other tech-oriented foreigners? it's the promise of the new bipartisan immigration and jobs plan introduced in the senate today. it's known as startup act 3.0. joining us now is the bill's sponsor, kansas republican

senator jerry moran and steve case, chairman and ceo of revolution, also the co-founder of americaline. senator moran, begin with you. why is it so hard for us to let in these smart brainiacs and technology entrepreneurs? what are we afraid of in this country? >> well, it shouldn't be that difficult. in my view this is just kansas common sense. this is something that republicans and democrats ought to find agreement upon and the reality is that when we fail to do that, we're physicaling out on a growing economy, putting americans to work and unfortunately we're losing a battle for that global talent because other countries have reached the conclusion to do what we're not doing. so jobs are being created, the american dream is being pursued but it's being pursued outside the united states. >> steve case, help me out in i'm wrong. you want to bring in entrepreneurs who will start companies, that's one class. second class is you want foreign students who go to our good

universities to be able to stay if they choose to. if that's correct, what's holding this up? >> well, these things are all complicated by senator moran and also the republicans and democrats who have been working together on this particular bill and this particular issue. everybody knows immigration is sensitive. but this is common sense reform. we can't get cocky or complacent about it. we need to focus on it. and startup 3.0 does that, not just on immigration but dealing with issues around tax incentives, regularation, commercialization, other things that can make sure we're doubling down on entrepreneurship as a key driver of our economy. >> senator moran, i thought the immigration section in last night's state of the union by the president was actually pretty good and opened up a lot of opportunities. i want to ask you, senator, was last night's state of the union a growth message? did you see it as such? is it a deficit reduction measure? what are your thoughts on the

state of the union? >> i did not see it as a pro-growth speech. one of the reasons i say that is one of the features that has to be addressed, one of the problems our country has to meet is this issue of the debt and deficit that's related to job creation and pro-growth policies. one of the reasons i got interested in the startup act is my belief that so little was being done in washington between republicans, democrats, congress, the president in regard to a deficit reduction, reducing spending and, therefore, if we're -- i'm not walking away from those issues. they're so important to the economy and to our country's future. but if we're not going to deal with spending, how else can we meet our country's deficit challenge? and that's growing the economy. i certainly welcome any help from president obama from my colleagues, republican democrat house senate. weep need to be growing this economy, not only will it create jobs which are so important to so many americans but it helps

us in the deficit that is so crippling to our future. >> all right. we'll leave it there. thank you, gentlemen. senator argerry moran and steve case, appreciate it. >> facebook executive mark zuckerberg is hosting a political fund-raiser tonight but you might be surprised what politician it's for. we have a live report coming up. please stay with us. this is the "kudlow report." all right that's a fifth-floor problem...

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here is a real sizzle story. facebook billionaire mark zuckerberg is hosting his first political fund-raiser tonight. guess who it's for? new jersey governor chris christie, out of the left coast with all of those silicon valley folks. who would have thunk it. julia is live outside his house. >> good evening. the security is already tight. we have helicopters overhead. everyone is getting ready for the big event when zuckerberg invites his friends to meet chris christie. christie is raising his profile as a bipartisan leader ahead of his 2016 prospective run for president.

this led tozuckerberg's $100 million education grant, which he announced on oprah. >> the main thing that i have to do is find people who are going to be really great leaders and invest in them. that's what we're doing here. we're setting up a $100 million challenge grant. >> zuckerberg has been doubling down on education philanthropy since then. he and his wife donated 18 million facebook shares to the foundation. now, there was a big statement for zuckerberg to throw his support behind the governor. he and facebook are nonpartisan. he posted a town hall for obama in 2011. cheryl bandberg was a big fund-raiser for obama but investor and board member bark andariesen publicly backed mitt romney for president.

donations are capped at $800 per head. it may be tough to tell through all the security and events are organizers are not releasing a list of who is expected to be here. >> julia, thank you very, very much. i want to ask my panelist, kelly ann, begin with you. this money from zuckerburg is not going to the foundation, it's going to chris christie's campaign. what does that mean? >> it's really great for mark zuckerberg. he's breaking a lot in silicon valley. for the democratic party. it shows he's willing to put political muscle behind public policy issues he and his wife care about. if i were governor christie, mark zuckerberg would be like a walking demographic dream for me, the youth vote, jewish vote, tech vote, tech money. i think they're going to have a tough talk about education reform, which is working in new jersey. >> is it going to be president

christie? he'll win the governorship easily. will it be president christie? >> i think there's a good chance of that. he's better in public than some others like rubio. i live in new jersey. in particular what i like what he's done with education is he's taken the money and he's trying to focus on the students rather than the democrats. >> you took at shot at rubio. >> i said that i like him more. it's not that i dislike him. >> the voters ask who is like you, they don't ask who you like. christie and rubio both have amazing personal stories. they inherited nothing from their parents except good values. that's where the republican party needs to go. they need to get away from this prototype of somebody who has -- who is wealthy, frankly, and can't really connect with people. >> we're going to come back, it's a very interesting point, especially back to the rubio story. we know it's true government workers work fewer hours, get better benefits and often get

paid higher salaries than private sector workers and, by the way, government workers rarely get fired. but that's not stopping the biggest government worker union boss from fanow demanding new raises and threatening any democrats that don't go along. we'll have the details of that whole mish mosh story. stay with us, "kudlow report."

welcome back to the "kudlow report." in this half hour, one of. most outspoken and respected politicians in america is about to join us. we're going to talk about his plans to fight president obama's executive orders, his defense of religious freedom and his case to preserve american liberty. and also call it the "kudlow report" fact checking service. president obama made a claim about mitt romney in the state of the union address last night but does that claim jive with something governor romney told me on this very program about a year ago? we're going to show you the videotape. but first up, he's one of the company's top labor unions turning on democrats. the head of the nation's largest public service employees union

ripped into two prominent democratic leaders earlier this. philadelphia mayor michael nutter and illinois governor pat quinn saying, quote, i've had enough of these turn coats and it's time to make them pay. make them pay for what? here to explain is cnbc contributor robert costa. this guy lee saunders has to be a nut. he's lucky he still got what he got. >> what really irks him is now democrats, mayor nutter of philadelphia, governor quinn of illinois, they're looking at their budgets and shaking their heads saying we can't take contracts anymore, can't take the spending.

>> you've seen scott walker, john kasich, republican governors all across the country, they've gone after union, write rite to work unions, collective bargaining unions, co-pays for health care and so on and so forth. how can this guy think he's immune from that? >> i think he's living in a world of 30 years ago. when a state like michigan pushes -- >> snyder, another one. >> that goes right to work. economies are bad, unemployment is high. these governors are competing for companies, businesses and jobs. they know that people can get up and go. look at california. they've had a huge flight of people over the last decade. high taxes, very pro union friendly state. >> look, what -- he's lucky nutting is not taking him to court, he's lucky he's not losing benefits. >> he's also ignoring these

lucrative government contracts for unions are -- they really bankrupted a lot of the states and municipalities so our governments and mayors are saying we can't afford to finance all these benefits. what's changed in the last three to five years is the public understands this also. the doors come off -- the secret doors come off the hinges, people really understand what's happeneding. i'll tell you who else is upset about all of this, private union members. if i were governor walker, governor pence, government snider in florida, i would lock on to the private unions who are upset about the way the public unions behavior. go and look on youtube. he actually gave $8.2 million just to super pacs alone in 2012. they expect a return on their money and they expect every democrat to fall in line. >> robert costa, here's a point.

kellyanne mentioned how private unions doesn't want to pay for public unions who have better benefits and compensation. taxpayers and home oowners don' want higher taxes to pay for better compensation packages. saunders has to realize that or is he an idiot? >> i think saunders is shocked. when you have such towering figures in the party such as the governor of illinois, a big blue state, a governor of a -- maybe of a blue city like philadelphia and they're turning on the public sector unions, who are some of the biggest fund-raisers in the party because they recognize the fiscal situation, the politics of public sector unions are shifting in this country and this is the biggest litmus test that shows that. >> they're going to have

givebacks, payroll cut backs, retirement cutback, it will be in new york city, in new york state. nobody wants to deal with this. hang on, robert costa. i like to do this. i want to go back to your remark that you think christie is better than rubio and tell me how rubio did last night. retranslate your remark. you said it off the cuff. i don't think you realized you said it. >> it's a feeling i have, larry, as someone who lives in new jersey, i've seen what christie's done. he's worked with the democrats in the state, which is a democrat-dominated state and this property tax reform that he got through has been great for our state. he's taken money and shifted it from school superintendents that were making $250,000 a year as a bureaucrat and focused more on -- >> partly because private unions and taxpayers don't want to pay higher property taxes to support the government unions. >> exactly.

this would be probably difficult to do during difficult times but property onners are saying i haven't gotten a raise in five years. >> give me a quick pencil test of marco rubio. i don't care he it to get some water because his mouth was dry. bobby jindal, good guy, kind of a disaster. how did rubio do? >> he was excellent. if you read what he said, you'd be even more impressed. >> that's it. >> that's the key. this man is reported to write much of his own speeches, practices and it was a guy who spoke from the heart. there was nothing contrived about what he said, when he was spoke and was bilingual about it and when he spoke about why he's a conservative and a republican, bass of the values and hard work his family instilled on him. it's nothing short of a disgrace that the media is so focused on water bottle gate. i would take a guy who is thirsty than a guy who says "a"

every five word. >> you got to read the speech. it's a hell of a good speech about how free enterprise is the true engine of growth for the middle class. i'm sorry i ran out of time. >> enough subject. from virginia he's sending up a beg warning about president obama's second term plan including executive order. ken cuccinelli will join us next. scalpel.

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welcome back, everybody. in obama's first term it was national security. yesterday it was cyber defense. before that it was unconstitutional recess appointments and in the future it could be epa-driven cap and trade, all areas in which the president could issue an executive order bypassing congress along the way. but it's the presidential power grab that's setting a dangerous precedent. here now we have somebody who is fighting back. virginia attorney general and gubernatorial candidate ken cuccinelli is the author of "the last line of defense." thank you very much. this is from obama's state of the union speech last night.

he starts talking about cap and trade. he says he favors the mccain bill and the lieberman bill, which by the way the democrats couldn't pass even when they held both house as couple years ago. then he says if you have don't get that through, we're going to do it by executive order, which i guess means the epa will institute cap and trade. it's that kind of attitude i want to hear your reaction to. >> that kind of attitude is consistent with an administration that breaks the law regularly and brazenly. you look at the nlrb case they lost last month. that was a pretty naked violation of the constitution. a lot of the pushback on a lot of these things are coming from the states, from other attorneys general and myself included. the epa is a major problem in this area. i refer to it as the employment prevention agency because they're so good at that. but we beat them last month and

last month our co-plaintiff was the democrat board of supervisors of fairfax county, the biggest county in virginia, it was a $300 million case. these are real big violations of the law and they have real big price tags attached to them if we lose. and the way that money would have been spent is taking people's homes and their businesses to tear them up to comply with what the epa wanted. so it has a real liberty impact also and we obviously wrote about that in the book "last line of defense" and we catalogued a lot of these violations by the president and his administration. >> i want to bring in kellyanne conway, who is dying to ask you. >> it seems like you represent a new model for ags across the country. we have the cuomo, spitzer, bloomenthal model where you sued private industry.

now you're challenging the federal government's overreaching authority and making people see the incredible overreach the federal government can have into our personal liberties and pocket books. i think you're being humble about the fair tax county situation. what fairfax county was trying to do was to regulate runoff and rain waters from storm and he basically saved people there $300 million. tell bus the new model for attorneys general and why you think can you pull it off. >> in 2009 when i ran for attorney general, we talked about challenging the federal government if they overstepped these lines in the law or constitution. i didn't think i'd have so many opportunities to keep that campaign promise but we did and weep did keep it. and starting in 2010 you saw people all across the country on the republican side running with that as their motto, we're going to be the guardians on the wall against the federal government. because we're protecting liberty now from the federal government. it is a great threat to liberty,

which is exactly what the founders feared. it's also why the founding fathers expected the states to push back, that we'd protect americans and we'd protect them in their homes, their businesses and their communities and preserve the liberty that that federal government was supposed to have been established to protect. >> attorney general, as far as i know president obama is the only president in history who has deemed the senate in recess when it was not in recess. i don't believe that's ever happened before so he could put through one of his executive orders. how do you think that's going to play out? >> well, first of all, i think you're correct. second of all, i assume with the pugnacious attitude from the nlrb they're going to appeal and i think you're going to see the president lose in the supreme court. i don't just say that because i hope he loses to protect the constitution, because i spoke in very limited terms about how the health care case my go. i knew it was going to a close

one. this one shouldn't be close. and it so brazen and it is the president himself brazenly overstepping the boundaries of the constitution and tramping the senate and, mind you, the majority leader of the u.s. senate should be ashamed of himself for not bothering to attempt to defend the prerogatives under the constitution of the u.s. senate. >> first he's got to defend the law writing a budget. >> he's four years late on that. they're not obeying that law either. >> the whole consumer finance protection board, that guy cordray who is anti-banks and anti-community banks, he isn't even legal because of that recess appointment. i got to get out of here. ken cuccinelli, wish you all the best of luck. >> now, folks, let talk about this minimum wage increase, right? the president came out of nowhere when he pushed for a substantial hike.

he even claimed that mitt romney agreed with him. here's what john boehner had to say the effect of minimum wage. >> at a time when american people are asking where are the jobs, why would we want to make it harder for small employers to hire people? and you'll find advanced safety technology like an available heads-up display on the 2013 lexus gs. there's no going back.

tonight let's declare that in the wealthiest nation on

earth no one who works full time should have to live in poverty and raise the federal minimum wage to $9 an hour. >> all right, you heard it, president obama calling for a 24% increase in the minimum wage to $9 an hour. he also said that mitt romney agreed with him about that. but is that really true? we reached back into the "kudlow report" archives and found actually governor romney talked to me about this very topic less than a year ago. here's what mr. romney really said about the minimum wage. >> well, actually when i was governor, the legislature passed the law raising the minimum wage. i vetoed it. i said on a regular basis in the proposal i made, we should look every two years look at the minimum wage, look at inflation and the jobs level throughout the country and that would tell you right now there's not a need to raise the minimum wage.

>> so mitt not in favor of hiking the minimum wage about a year ago. a higher minimum wage will increase unemployment, not reduce it. >> all right, kevin. i don't really get this at all. it comes out of left field. you've got high teen-age unemployment, high african-american unemployment. what's a higher minimum wage going to do? >> i was really horrified when i heard the proposal. i ran the numbers, larry and it's terrible, the african-american and teen unemployment rate is about 38%. if president obama's proposal goes through, it will jump immediately to 43%. there are 5 million people that have been unemployed for more than 27 weeks, the most since the great depression. raising the cost of giving people jobs is not the right answer. >> why do you reckon he's doing it?

>> i think it's corruption frankly. i think that what the democrats do is they're funded by the unions and the unions are always concerned about competition from nonunionized competitors who have lower wages. none of the wages are paid the minimum wage but they advocate a higher minimum wage. it's really shameful. it does very big harm to the people who lose their jobs. >> it kind of puts the base higher and you build on top of that higher wages, if you have a good paying job. so those that have actually get help. those that don't have a job are never going to get a job and those at the margins are probably going to get fired. michael, let me ask you an odd question. i heard talk about the minimum wage, no idea if it's going through congress, heard about energy subsidies, housing subsidies. what's that's going to do in

your judgment to the stock market? >> i think eventually it's going to cause the stock market to go down considerably. the mother's milk of stock prices is corporate earnings. >> who said that? >> it was some show host i know. >> brilliant man. >> but you're not going to have the profits to drive stock prices higher. the minimum wage really bothers me. who hasn't worked the minimum wage at some point. it's not where you're going to spend your career. it's a stepping stone. it gives you experience, allows you to get experience to take to your next job. if you don't have that experience, it's going to hurt your ability to advance. >> nobody's really looked at this. he didn't talk much about jobs last night. he said he was going to but the stuff we heard was the same old spending stuff and subsidy. if the economy stays at 2% subpar or less, it is the worst in modern times going back to 1947.

what does that do to his political standing? >> and overreach. this man is misreading the electorate. he thinks we're a center left company now. his personal popularity will always be high but we should not ask, you know, if he's likeable, he's not the prom king, he's the president. i think his political currency will diminish at some point. people will get tired of him talking. this is a man who promised in twa 2008 when he ran the first time to raise the minimum wage. let's focus on cause and effect. why are these people in poverty? we have the highest extreme poverty rate for women in this country in modern times because of his economic policies. and he never really talks about that. he only talks about the elixir. and this whole idea do you want people to be in the food bank or be able to buy groceries? if you lose your job because an employer can't afford it, you'll always be at the food bank.

>> what is the economy going to do in your judgment? you heard the state of the union and unemployment. what's it going to do? >> right now we're growing 1.5%. i think that's all we're going to get unless congress does something smart and that usually doesn't happen. >> thank you very much. >> folks, we didn't want to leave tonight without showing you the winner of the westminster dog show. this is banana joe, best in show. he's an affenpincher. like many best in show, he's going to retire. that makes way for my grace, she's about 4, 5 months old at the time. thanks, everybody. appreciate it. that's this evening's show. we have a lot to mull over, a lot of uncertainties in this show. i'm kudlow. we'll be back tomorrow night.

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